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MANUFACTURERS ASSN. OF TRI-COUNTY v. KNEPPER

December 12, 1985

MANUFACTURERS ASSOCIATION OF TRI-COUNTY, et al., Plaintiffs
v.
JAMES W. KNEPPER, JR., et al., Defendants and PENNSYLVANIA AMERICAN FEDERATION OF LABOR--CONGRESS OF INDUSTRIAL ORGANIZATIONS, et al., Intervenors PENNSYLVANIA FOUNDRYMEN'S ASSOCIATION, et al., Plaintiffs v. JAMES W. KNEPPER, JR., et al., Defendants and PENNSYLVANIA AMERICAN FEDERATION OF LABOR--CONGRESS OF INDUSTRIAL ORGANIZATIONS, et al., Intervenors



The opinion of the court was delivered by: CALDWELL

CALDWELL, U.S.D.J.

 M E M O R AN D U M

 I. Introduction.

 Plaintiffs, defendants and intervenors have filed cross motions for summary judgment. Plaintiffs are certain manufacturers, manufacturing associations and non-manufacturers doing business in Pennsylvania. Defendants are James W. Knepper, Jr., Secretary of the Department of Labor and Industry, Herbert Thieme, Deputy Secretary for Administration of the Department of Labor and Industry, the Pennsylvania Department of Labor and Industry, and the Commonwealth of Pennsylvania. Intervenors are the Pennsylvania American Federation of Labor-Congress of Industrial Organizations ("AFL-CIO"). The International Union (also known as United Auto Workers) has also filed an amicus curiae brief. This consolidated action *fn1" arises from the enactment of the Pennsylvania Worker and Community Right to Know Act, P.L. 734 No. 159, 35 P.S. § 7301 et seq. ("Right to Know Act") which establishes a statewide program for communicating information concerning hazardous substance to employees and the general public. Plaintiff's primary contention is that, based upon the recent decision of New Jersey State Chamber of Commerce v. Hughey, 774 F.2d 587 (3d Cir. 1985), the Right to Know Act is preempted by § 18 of the Occupational Health and Safety Act ("OSH Act") (29 U.S.C. § 667), and the Hazard Communication Standard ("The Standard") (29 C.F.R. § 1910.1200) as it applies, (1) to employers who are included within the Standard Industrial Classification ("SIC") Codes 20-39 and (2) as it applies to employers outside SIC Codes 20-39. *fn2" In accordance with Hughey defendants and intervenors acknowledge that certain provisions of the Right to Know Act are preempted, but nevertheless maintain that the remainder of the Right to Know Act should be enforced, and that the preempted sections of the Act can be severed. In addition to their preemption argument plaintiffs also assert that the Right to Know Act imposes an excessive burden on interstate commerce in violation of the Commerce Clause of the Federal Constitution and deprives plaintiffs of their property rights in trade secrets and confidential information without just compensation.

 For the reasons set forth below, we conclude that the Right to Know Act is entirely preempted by federal law to the extent it requires employers in the manufacturing sector to identify and disclose information concerning workplace hazards. The Right to Know Act is not preempted as it applies to employers in the non-manufacturing sector, nor as it requires all employers to disclose information relating to environmental hazards, except for the labeling requirement in the manufacturing sector. We also conclude that the Right to Know Act does not violate the Commerce Clause or constitute a taking without just compensation.

 II. Background.

 A. The Pennsylvania Worker and Community Right to Know Act.

 On October 5, 1984 the Governor of Pennsylvania signed the Right to Know Act into law, to become effective on October 5, 1985. *fn3" The purpose of the Act inter alia is "to ensure that employees, their families and the general public be given current information concerning the nature of the hazardous substances with which they may come in contact and full information concerning the health hazards of these hazardous substances." 35 P.S. § 7301 (Preamble to the Act). It establishes a comprehensive statutory scheme for (1) identifying and (2) communicating to employees, emergency response agencies, health care professionals, and the general public information concerning hazardous chemicals employed in the workplace. These objectives are accomplished primarily through the following procedures.

 The primary burden of disclosing hazardous substances falls upon manufacturers and suppliers of chemicals. The Right to Know Act provides that "every supplier, as a condition of doing business in this Commonwealth, shall ensure that the container of any chemical which is delivered to a point within this Commonwealth or which is produced within this Commonwealth is clearly labeled in the manner required by section 6." 35 P.S. § 7304(a) (footnote omitted). Section 6, in turn specifies the information that must be disclosed. 35 P.S. § 7306(a). The Right to Know Act further provides that within two (2) years all containers, used by entities covered by the Act, regardless of whether they contain hazardous substances, must be labeled. 35 P.S. § 7306(a)(4). In addition, employers are required to place labels at or near all pipeline ports. 35 P.S. 7306(c).

 Similarly, manufacturers, importers and suppliers must prepare a material safety data sheet ("MSDS") for each designated "hazardous substance or hazardous mixture they produce or import, and shall ensure that all purchasers of hazardous substances or hazardous mixtures are provided with an appropriate MSDS . . . ." 35 P.S. § 7304(b). The Department of Labor and Industry must also be supplied with a copy of each MSDS. The MSDS must incorporate certain information, including the chemical name, its physical characteristics, and its health hazards. Id.

 The Right to Know Act also permits employers, manufacturers, etc., to withhold the identity of a chemical substance as a trade secret. 35 P.S. § 7311. This protection is not absolute and the claimant must satisfy the criteria in § 7311(a). In no case is the claimant permitted to withhold a chemical's identity from a treating physician or nurse. The claimant may, however, require the physician or nurse to sign a confidentiality agreement. 35 P.S. § 7311(b).

 Finally, employers are obligated to disclose the information required by the Right to Know Act to (1) employees and (2) the community. Employers must post in the workplace a listing of all designated hazardous substances present and make available in the work area a MSDS for each hazardous substance to which the employees may be exposed. 35 P.S. § 7307. Employers are also required to provide, at least annually, educational and training programs for employees exposed to hazardous substances. 35 P.S. § 7308. With respect to public disclosure, employers must make available to the community, including local police, fire and emergency response personnel, copies of HSSF's, EHS's and MSDS's upon demand. 35 P.S. § 7305.

 B. The Hazard Communication Standard.

 In 1970 Congress enacted the Occupational Safety and Health Act (OSH Act), 29 U.S.C. §§ 651 et seq. "to assure so far as possible every working man and woman in the Nation safe and healthful working conditions." 29 U.S.C. § 651(b). Pursuant to § 655 of the OSH Act, the Secretary of Labor was given the authority to promulgate standards to implement its purposes, and on November 23, 1983, the Occupational Safety and Health Agency ("OSHA") published the final Hazard Communication Standard. The stated purpose of the Standard is to "insure that the hazards of all chemicals produced or imported by chemical manufacturers or importers are evaluated, and that information concerning their hazards is transmitted to affected employees within the manufacturing sector." 29 C.F.R. § 1910.1200(a)(1). By its terms it is applicable to all employers in SIC Codes 20-39.

 The Standard is practically duplicative of the Right to Know Act and likewise can be broken down in two parts. First, chemical manufacturers and importers must assess the hazards of chemicals which they produce or import. Second employers must communicate the hazards to their employees by means of a hazardous communication program which "includes at least the mandated container labeling, material safety data sheets ("MSDS"), and an employee training program." 48 Fed. Reg. 53,336.

 The MSDS is the principle instrumentality for transmitting hazard information. 48 Fed. Reg. 53,305. Chemical manufacturers and importers must develop a MSDS for each substance they identify as hazardous which includes the name(s) of the chemical, its physical and chemical characteristics and its health and safety characteristics. 29 C.F.R. § 1910.1200(g). The MSDS's must also be readily available to employees. In addition, manufacturers, importers, and distributors must ensure that each container of hazardous chemicals leaving the workplace is appropriately labeled and all employers must ensure that containers utilized in the workplace are labeled. 29 C.F.R. § 1910.1200(f). The hazard communication program must also include an employee training program designed to provide employees with the skills necessary to detect hazardous conditions and to take appropriate protective measures. 29 C.F.R. § 1910.1200(h)(2).

 Finally, the Standard provides for trade secret protection. 29 C.F.R. § 1910.1200(1). The employer may withhold the identity of a chemical substance if it satisfies the requirements contained in 29 C.F.R. § 1910.1200(i)(1). Notwithstanding this provision, employers must reveal the identity of a substance to a treating physician or nurse if they determine that a medical emergency exists. 29 C.F.R. § 1910.1200(i)(2). Under certain circumstances, the employer may require a written statement of need and confidentiality agreement. Id.

 III. Discussion.

 A. Application to Employers covered by the SIC Codes 20-39.

 The United States Supreme Court recently set forth the standards for determining preemption of state law in Hillsborough County v. Automated Medical Laboratories, Inc., 471 U.S. 707, 712, 85 L. Ed. 2d 714, 721, 105 S. Ct. 2371, 2375 (1985) as follows:

 
[3] It is a familiar and well-established principle that the Supremacy Clause, US Const, Art VI, cl 2, invalidates state laws that "interfere with, or are contrary to" federal law. Gibbons v Ogden, 9 Wheat 1, 211, [22 U.S. 1], 6 L Ed 23 (1824) (Marshall, C. J.). Under the Supremacy Clause, federal law may supersede state law in several different ways. First, when acting within constitutional limits, Congress is empowered to pre-empt state law by so stating in express terms. Jones v Rath Packing Co., 430 US 519, 525, 51 L Ed 2d 604, 97 S Ct 1305 (1977). In the absence of express pre-emptive language, Congress' intent to preempt all state law in a particular area may be inferred where the scheme of federal regulation is sufficiently comprehensive to make reasonable the inference that Congress "left no room" for supplementary state regulation. Rice v Santa Fe Elevator Corp., 331 US 218, 230, 91 L Ed 1447, 67 S Ct 1146 (1947). Pre-emption of a whole field also will be inferred where the field is one in which "the federal interest is so dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject." Ibid.; see Hines v Davidowitz, 312 US 52, 85 L Ed 581, 61 S Ct 399 (1941).

 In addition, state laws can be preempted by federal regulations as well as by federal statutes. Id. at , 85 L. Ed. 2d at 721, 105 S. Ct. at 2375; Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691, 81 L. Ed. 2d 580, 104 S. Ct. 2694 (1984).

 In the present case, Congress has expressly provided for the preemption of state laws in § 18 of the OSH Act which provides in pertinent part:

 
(a) Assertion of State standards in absence of applicable Federal standards Nothing in this chapter shall prevent any State agency or court from asserting jurisdiction under State law over any occupational safety or health issue with respect to which no standard is in effect under section 655 of ...

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